Skill Definition – A rigorous understanding of the suitability of potential alliance partners BEFORE you enter a relationship with them.
A demonstration of this ability would probably involve the following:
§ In practice due diligence will differ both from business sector to business sector but also from different type of relationship to relationship. However, the core fact remains that at least some time assessing the suitability of candidate partners before entering into binding discussions with them will provide value many times over later in the relationship.
§ In some cases a full and formal due diligence process is impossible and it is here that the relationship manager must make a ‘judgement call’ as to how much effort to put into the process bearing in mind: the size of the prize, the state of collaboration knowledge in the partner organisation, the intent of the relationship, etc.
§ Both parties should understand that an assessment of how they will work together before they try is of enormous value. Clearly it is of importance thatneither side intimidates the other through the use of this process, rather it is designed to establish ‘How will we most effectively work together?’
§ Just beacuse a partner has a large market share in a particular sector or has some great technology software, hardware or services does not make the artner attractive. Many relationships have suffered from the curse of non integrated functions or processes which has led o costly and time consuming failed collaborations.
§ Typical due diligence asessment should include:
o Internal - How prepared is the organisation to partner?
o External – How will the market (and other existing partners) react?
o Commercial – Is there money here?
o Technical - Alignment of both companies’ products and services (overlap)
o Strategic - Understanding of where the other partner is heading
o Cultural – How easy will it be for us to interoperate?
o Operational – How will it work country by country or business unit by business unit?